How to integrate ESG factors into equity analysis
Taking non-financial issues into consideration gives a more holistic view of a company, and can alter risk and valuation numbers
WHAT does it mean to integrate Environmental, Social and Governance (ESG) factors into an investment analysis?
The process entails using non-financial information as added determinants to traditional factors, in assessing total risk and valuation of a company. Increasingly, portfolio managers are viewing some non-financial factors as material risk factors to companies, so including ESG consideration in the analysis could significantly alter evaluations.
Identifying ESG factors
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